I’m a senior writer for 30 Point Strategies and a writer-at-large for Texas Monthly. I worked in daily journalism for 26 years, most recently as an award-winning business columnist for the Houston Chronicle, and before that, as a senior writer at Bloomberg News. I’ve written two books: Drowning in Oil: BP and the Reckless Pursuit of Profit, published in 2010 and The Man Who Thought Like a Ship, published in 2012. My other interests include slow boats, fast cars and classic rock, all of which may also creep into my writing from time to time.

Obama's 'All-The-Above' Energy Push Becomes A Strategy Of One

President Obama hit energy issues early in his State of the Union speech, noting that the U.S. oil and natural gas boom has created thousands of jobs and reduced American crude imports to their lowest level in 20 years. Returning to an idea he proposed in 2012, he talked up his “all-the-above” energy strategy. This time, though, the pitch was far more selective. While he made a passing reference to solar power, he said nothing about nuclear power, biofuels, coal, the Keystone pipeline, liquefied natural gas exports or wind.

It was natural gas’ night, drawing praise from the president for its ability to slow the growth of carbon emissions and its role as a “bridge” to other, cleaner fuels. The almost singular focus on natural gas amounted to an endorsement of hydraulic fracturing, a pragmatic recognition that a booming domestic energy industry is one of the country’s few economic bright spots. It wasn’t what environmentalists, who had already criticized the “all-the-above” strategy, wanted to hear.

When he first rolled out the “all-the-above” plan, Obama said it would lead to energy that’s “cleaner, cheaper, and full of new jobs.” At the time, I said he’d be lucky to get one out of three. Two years later, though, he’s got a hat trick, just not the way he’d expected.

Renewables, while cleaner, remain expensive and, in the case of wind and solar, at least, unreliable. It isn’t all of the above that have delivered on Obama’s promise, it’s one of the above: natural gas. Hydraulic fracturing has spawned a job boom, and it’s made natural gas cheap and abundant. While it’s still a fossil fuel, it burns cleaner than oil or coal. It’s little wonder, then, that “all of the above” increasingly has become a strategy of one.

As for the rest of the above, only solar got the nod. Obama noted that “every four minutes, another American home or business goes solar,” but he didn’t address what percentage of their power needs are met by solar. For all the advances, it remains a supplemental fuel. He then suggested, as he has before, that we divert tax breaks from fossil fuel industries to fund more development of “fuels of the future.”

While that policy makes some sense, it needs to be pegged to commodity prices, otherwise when prices fall we could find ourselves with none of the above.

Many environmental groups remain steadfastly opposed to fracking, rather than recognized it as a viable compromise. Natural gas may be a fossil fuel, but it’s a better option than oil or coal. While its continued use won’t reduce carbon emissions, it can slow the growth of them. As Obama noted, the U.S. has reduced its carbon output more than any other country in the past eight years. The recession and improved energy efficiency may have been the big drivers, but natural gas helped. (The president conveniently neglected to mention carbon output rose last year, as some utilities shifted back to coal.)

The problem that Obama now faces, and that worries environmentalists more than even the Keystone pipeline, is that a president desperate for economic success and job growth is going to put the short-term benefits of fossil fuels ahead of the long-term development of viable renewables. That has been the energy challenge at which American policy repeatedly has failed during the past 40 years. With fossil fuels efficient, economical and abundant, we may once again take so much comfort in the boom that we stop worrying about what happens when it ends.

Last night, all of the above sounded more like one of the above. That may have been a reflection of the speech’s pragmatic tone, but the risk is that one of the above becomes a bridge to nowhere.

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It’s intuitive that fracking creates jobs. There are of course the people involved in the fracking itself and then those who make the equipment that’s used in fracking. Then of course if the price of natural gas and/or goes down or doesn’t rise so much, then those people who don’t pay for more expensive gas will spend their money on something else which will produce jobs. I don’t know enough economics to quantitfy this however.

There’s lots of numbers and they’re all over the map, but there has been some good academic work done at the regional level. If you look at this study from UT San Antonio, for example, it does a pretty good job of assessing the economic impact of the Eagle Ford shale activity in South Texas. It found an additional 47,000 jobs had been created in that region in 2011.

Obama is wrong on just about everything he has done. But with the possible exception of Obamacare, there is no area that he has done more damage in than the area of energy. Obama is a dunce when it comes to Energy and he’s surrounded by a confederacy of dunces both at the Dept of Energy and EPA. There has NEVER been a bigger assortment of fools and idiots at these agencies than what’s been put there for Obama. We will be lucky to survive these fools.

One can make the argument that it is unfair to keep American produced energy in America but you cannot honestly argue that it isn’t also good for American consumers and American manufacturers. Drill Baby Drill was sold to the public with the premise that increased energy production at home would benefit all Americans. That can only happen if we keep all that new production here.

Building KXL, and any infrastructure that facilitates the export of domestically produced energy will cause energy prices in America to rise and rising prices will cost American’s jobs. All that one needs for proof is to look at spiking prices for propane to understand the intrinsic relationship between demand and exports. Propane prices began their steep rise in the warm days of summer, exactly when new infrastructure came online that dramatically increased exports, blaming it on winter is just a distraction.

Keystone isn’t about exporting oil, it’s about importing oil. We’ve been over this before.. It would import oil from western Canada and move it to U.S. refineries. As for rising prices, increased U.S. production has actually helped mitigate price spikes on the world market in the past year. And U.S. manufacturers are bringing more jobs back onshore because of the cheap natural gas that has resulted from fracking. You can’t compare propane to oil. They are two very different markets.

While expanded energy production does create some jobs directly, it is the indirect benefit of lower energy costs to industry and consumers where job creation… and maintaining… is most important. One only has to look at the agony of Europe where high-cost energy is threatening their industrial base and, from there, entire economies. That’s why European politicians are backpedaling so quickly from their support of alternate energy mandates and subsidies and seeking new sources of conventional fuels.

President Obama is disingenuous to imply that he should be given credit for the increase in oil and natural gas production given that he has presided over a decrease in such production on Federal lands… and his adamant opposition to “fossil” fuels. He would do Janus proud.

Uh. Nuclear energy doesn’t use any more water than coal or gas or any other power source that makes energy from steam. Furthermore if water usage were a problem we could switch to other forms of power conversion such as supercritical CO2 turbines (look ma! Carbon sequestration! :P). As far as Fukushima we had basically the worst situation possible and not a single death. Not to mention the nearby Daini reactors (slightly more modern) got hit with the same thing and shutdown without catastrophic meltdown. Nuclear power is the safest and cleanest form of economically viable power generation we have.

Renewables are not at all unreliable. They may be intermittent – but they are not unreliable. Wind is perhaps most intermittent, but the experience of ERCOT in Texas as well as other grid operators show that if you plan right, tighten up your forecasting to smaller increments (15 minutes, with 5 minutes preferable), and create the right transmission infrastructure, renewables are highly cost-effective.

Now natural gas – THAT can be unreliable, if the pipelines are not in place. In New England last week, 75% of gas fired gen was offline because there was not enough transportation capability to meet demand. All of the above works pretty well for investment portfolios, and it allows for progress across a wide range of technologies on the energy front, especially electric energy.

Well, the renewables in ERCOT are cost-effective only as long as the state subsidizes the transmission and the feds subsidize the construction. That’s a little like saying American Airlines is highly cost-effective because its doesn’t have to pay all its bills in bankruptcy. Wind has done little to improve ERCOT’s reliability, as witnessed by the near rolling blackout incident earlier this month. I’m not against diversifying the generation portfolio, but wind remains a heavily subsidized, supplemental fuel.